Daily Price Outlook

Despite the recent strength of the US dollar and the Fed’s higher-for-longer interest rates narrative, gold prices (XAU/USD) extended their upward trajectory and remained steady above the $2,035 level. This rise was attributed to prolonged tensions in the Middle East, which bolstered the appeal of safe-haven assets such as gold. In the meantime, cautious sentiment prevails in the market ahead of the release of the US Personal Consumption Expenditures (PCE) Price Index, which could provide cues about the Federal Reserve's rate-hike path. This keeps investors cautious, leading them to invest in gold as a safe-haven asset.

In contrast to this, the Fed's hawkish outlook on interest rates was seen as a key factor that capped further gains in the gold price. Furthermore, the second estimate of US GDP growth for Q4 showed a 3.2% rise, slightly lower than the original 3.3%, but still signals economic strength. Hence, the positive US GDP growth indicates a hawkish stance from the Fed regarding rate cuts. As a result, the US dollar gained momentum and remained steady.

Investors are awaiting the US Personal Consumption Expenditures (PCE) Price Index. Meanwhile, the release of Weekly Initial Jobless Claims, the Chicago PMI, and Pending Home Sales, which, along with Fed speak, will also be in the spotlight.

US Federal Reserve Outlook and GDP Data Impact on Monetary Policy and Market Dynamics

On the US front, Federal Reserve officials stressed the need to tackle inflation further, signaling that interest rates may stay higher for longer. New York Fed President John Williams suggested rate cuts might start in 2024, likely in the second half, as inflation hits its 2% target unevenly. Atlanta Fed President Raphael Bostic expressed a preference for patience in policy adjustments, underscoring that the battle against inflation isn't won yet. Meanwhile, Boston Fed Bank President Susan Collins indicated a likelihood of rate cuts this year but stressed the importance of data assessment before any policy changes are made.

On the data front, the second estimate of US GDP growth released on Wednesday showed that the economy grew by 3.2% in the fourth quarter, just a bit lower than the initial report of 3.3%. This data suggests that the US economy is still doing well overall. However, it reinforced hawkish Fed expectations, which tend to strengthen the US dollar and lower gold prices.

Geopolitical Tensions in Gaza: Impact on Stock Market and Safe-Haven Assets

On the geopolitical front, Israeli airstrikes and shelling hit Nuseirat, Bureij, and Khan Younis camps in Gaza, resulting in at least 30 deaths. According to the Gaza Health Ministry and MSF, Save the Children, a charity organization for children, warns of a slow-motion mass killing of children in Gaza. Six children in north Gaza died from dehydration and malnutrition, with Gaza's healthcare system on the brink of collapse. Samantha Power of USAID stresses the urgent need for more aid to Gaza. Since October 7, Israeli attacks in Gaza have left nearly 30,000 people injured and over 70,000 displaced, while 1,139 have died in Israel.

Therefore, this news is likely to have a negative impact on risk sentiment in the stock market and may boost safe-haven assets like gold due to increased geopolitical tensions and uncertainty.

GOLD (XAU/USD) - Technical Analysis

Gold's price on February 29 edged higher by 0.07%, marking a subtle increase to $2035.805. This incremental rise reflects a cautiously optimistic sentiment among investors, as gold continues to be a focal point in the financial markets amidst ongoing global economic uncertainties.

The pivot point for gold is established at $2025.07, providing a baseline for the day's trading dynamics. Resistance levels are identified at $2040.44, $2053.29, and $2065.71, outlining potential ceilings that gold prices might encounter should the upward momentum persist. Conversely, support levels are placed at $2016.41, $2001.46, and $1988.19, indicating key thresholds where buying interest could re-emerge, potentially stabilizing prices.

The Relative Strength Index (RSI) at 55 suggests a balanced market condition, leaning slightly towards a bullish bias without entering overbought territory. The 50-day Exponential Moving Average (EMA) at 2028.050 closely aligns with the current price, further reinforcing the gold market's current stability and slight bullish inclination.

Daily Price Outlook

The GBP/USD currency pair continued its downward trend around the 1.2660 level due to various factors, including a strong US dollar and a dovish stance from the Bank of England (BoE). These factors weakened the GBP and contributed to the pair's losses. However, recent disappointing US economic data could limit the dollar's gains, potentially helping the GBP/USD pair stabilize. Investors are now focused on the upcoming US GDP growth figure for the fourth quarter, which will be released later today.

GBP Faces Challenges Amid BoE's Inflation Concerns and Expected Rate Cuts

On the UK front, Bank of England (BoE) Deputy Governor Dave Ramsden recently stated that inflation pressures persist. He expressed the need for more data to assess the duration of these pressures before considering changes to BoE's policy. The BoE forecasts inflation to return to its 2% target in the second quarter of 2024 but anticipates it may rise to approximately 2.75% later this year. Financial markets anticipate the UK central bank to commence interest rate reductions in August.

Consequently, the outlook suggests potential challenges for the GBP currency. Persistent inflation pressures and the likelihood of BoE interest rate cuts could exert downward pressure on the GBP in the near term.

Challenges for GBP Amid Inflation Concerns and Expected BoE Interest Rate Cuts

On the US front, the Federal Reserve is adopting a cautious approach, signaling a delay in interest rate cuts despite market expectations. However, the recent meeting minutes and official comments suggest they are not in a rush to lower rates. This stance typically strengthens the US dollar and lower GBP/USD currency pair. Nevertheless, declining bond yields and disappointing Durable Goods Orders could provide some support to the GBP/USD pair by undermining the US dollar.

On the data front, January's Durable Goods Orders showed a larger-than-expected decline of 6.1%, while orders excluding defense met expectations with a slight increase of 0.1%. The Consumer Confidence Index for January was below market consensus at 106.7, indicating slightly lower consumer sentiment than anticipated. Looking ahead, the US Personal Consumption Expenditure Index (PCE) for January is expected to increase by 0.3% from December.

Therefore, the Federal Reserve's cautious stance tends to strengthen the US dollar, potentially lowering the GBP/USD pair. Conversely, the larger-than-expected decline in Durable Goods Orders and lower Consumer Confidence Index could weaken the US dollar. However, a potential increase in the Personal Consumption Expenditure Index may provide some support.

GBP/USD - Technical Analysis

The GBP/USD pair is currently navigating a downward trajectory, with a 0.19% decrease observed, positioning the pair at 1.26658. This movement reflects the market's apprehensive sentiment as investors assess the currency's direction amidst fluctuating economic indicators and geopolitical developments. The day's pivot point is established at 1.2651, offering a critical juncture that could determine the pair's short-term momentum.

Resistance levels are staged at 1.2699, 1.2729, and 1.2772, delineating potential challenges for upward price movements. On the contrary, immediate support appears at 1.2613, with subsequent levels at 1.2567 and 1.2530, which could provide a cushion against further declines.

The Relative Strength Index (RSI) stands at a neutral 50, indicating a balance between buyers and sellers, yet the break below the upward trendline hints at possible intensified selling pressure. This technical breach underscores the necessity for traders to monitor these critical levels closely.

Considering the present technical indicators and market dynamics, a bearish perspective is advised for the GBP/USD pair. Traders might consider a selling strategy below 1.26608, with a take profit target set at 1.26139 and a stop loss at 1.26978, to navigate the anticipated market movements effectively.

Daily Price Outlook

Despite recent comments by European Central Bank (ECB) President Christine Lagarde, the EUR/USD currency pair has been unable to halt its downward streak and continues to hover around the 1.0820 level. However, the renewed strength of the US dollar has played a major role in pushing the EUR/USD lower. On the flip side, Christine Lagarde recently stated that while inflation is nearing the central bank's targets, they intend to maintain current policy measures unchanged. This indicates a steady economic environment, reducing uncertainty for investors. This stability can boost confidence in the Euro, leading to increased demand and strengthening its value.

Investors will closely watch the Euro Zone Economic Sentiment Indicator for February and the preliminary Gross Domestic Product Annualized (Q4) from the United States, scheduled to be released later in the day.

US Dollar Strength Amid Risk-off Sentiment and Fed's Hawkish Remarks

Despite previously released downbeat US economic data, the broad-based US dollar gained momentum and remained well-bid thanks to the risk-off market sentiment, which strengthened safe-haven assets like the US dollar. Furthermore, hawkish remarks by the Federal Reserve about interest rate decisions played a major role in bolstering the US dollar. It should be noted that the probability of rate cuts in March has diminished to 1.0%, while the possibility of cuts in May and June stands at 21% and 49.8%, respectively. This supported the US dollar and contributed to losses in the EUR/USD pair.

European Central Bank's Policy and German Economic Data

Despite inflation steadily approaching the European Central Bank's targets, recent comments by ECB President Christine Lagarde suggest that the bank intends to maintain its current policy measures unchanged for the future. This provided mild support to the EUR currency and was seen as a key factor that may help the EUR/USD pair limit its losses.

On the data front, the Gfk German Consumer Confidence Survey for March matched expectations with a reading of -29, compared to the previous -29.6 in February. The focus will now turn to Germany's Retail Sales and Consumer Price Index (CPI) inflation data later in the week to gain more insights into the economic situation. Hence, the Gfk German Consumer Confidence Survey meeting expectations may support the EUR, but focusing on upcoming data is crucial for further impacts.

EUR/USD - Technical Analysis

In the latest trading session, the EUR/USD pair witnessed a modest decline, marking a 0.15% decrease to trade at 1.08333. This movement suggests a cautious sentiment among traders as they navigate through fluctuating market dynamics. The pivot point for the day is set at 1.0859, indicating that movements below this level could signal further bearish momentum for the currency pair.

Key resistance levels are identified at 1.0895, 1.0932, and 1.0966, which could serve as potential hurdles for any upward movement. Conversely, immediate support is found at 1.0798, followed by 1.0763 and 1.0731, offering crucial buffers against further declines.

The Relative Strength Index (RSI) stands at a neutral 50, suggesting a balance between buying and selling pressures. However, the breach of the upward channel on the downside indicates potential for increased selling activity, underscoring the importance of monitoring these technical thresholds closely.

Given the current technical landscape, a bearish outlook is recommended for traders, with a suggested entry point for selling below 1.08340. Setting a take profit at 1.07980 and a stop loss at 1.08627 could optimize trading strategies in the face of emerging market trends.

Daily Price Outlook

Despite the recent strength of the US dollar, Gold prices (XAU/USD) continued to gain support and remained well bid around above the $2,030 level. However, this rise was attributed to long-lasting tensions in the Middle East, which bolstered the appeal of safe-haven assets such as gold. On the flip side, the US dollar gained momentum due to the Federal Reserve's hawkish stance on interest rates. This could cap gains in the gold price. Besides this, the risk-on market sentiment, supported by the Federal Reserve's hawkish outlook, was seen as another key factor that kept the lid on any additional gains in the gold price.

Looking forward, Investors are awaiting the release of the Preliminary US GDP print as well as upcoming speeches by influential FOMC members, will play a key role in driving USD demand and creating meaningful trading opportunities around XAU/USD. Moreover, the US Personal Consumption Expenditures Price Index will be in the spotlight.

Powell's Rate Cut Signals and Economic Indicators Impacting Gold Prices

On the US front, the Federal Reserve's recent meeting minutes and comments from officials suggest they're not in a rush to cut interest rates. This decision tends to strengthen the US dollar but can lower gold prices. However, the decrease in US bond yields, the possibility of a government shutdown, and disappointing Durable Goods Orders could weaken the dollar's strength and helps the gold price to stay bid.

On the data front, US manufactured goods orders fell by 6.1% in January, the sharpest drop in nearly four years. The Consumer Sentiment Index also fell to 106.7 for February, despite lower inflation expectations. In the meantime, the Richmond Fed's Manufacturing Index improved to -5 in February from -15, marking the fourth consecutive month of negative readings.

Therefore, the Federal Reserve's decision not to rush interest rate cuts tends to strengthen the US dollar and lower gold prices. Other factors like lower bond yields and economic data can also impact gold prices.

Geopolitical Rumors and Economic Concerns Shape Gold Prices

On the geopolitical front, the ongoing talks between Israel and Hamas about ceasefire were uncertain, indicating ongoing tensions. However, the Iran-backed Houthi group continued targeting civilian ships in the Red Sea, posing a threat to maritime security. Meanwhile, Gaza faced a humanitarian crisis, with limited access for aid organizations, and one-quarter of its population going hungry.

President Biden urged Congress to support Israel's defense and sought to cut funds to the UN agency for Palestinian refugees (UNRWA). Israeli attacks on Gaza resulted in thousands of deaths and tens of thousands of injuries. Therefore, the geopolitical tensions, particularly in the Middle East, often lead to increased investor uncertainty and risk aversion, potentially boosting demand for safe-haven assets like gold, consequently impacting its price.

GOLD (XAU/USD) - Technical Analysis

Gold's trading session concludes with a marginal uptick, marking a 0.05% rise to settle at $2030.56, reflecting the market's oscillation within a tightly bound spectrum. This subtle movement underscores the investors' wait-and-see approach, particularly as they anticipate forthcoming economic data that could sway Federal Reserve policy decisions.

The pivot point for the day is pegged at $2028.69, delineating a fine line between bullish and bearish territories. Resistance levels are staged at $2041.30, $2053.29, and $2065.71, which could act as ceilings for any upward momentum. Conversely, support is found at $2016.41, with further cushions at $2001.46 and $1988.19, marking potential zones where buyers might emerge.

Technical indicators reveal a nuanced picture: the Relative Strength Index (RSI) hovers at 51, indicating a neutral market sentiment, while the crossing below the 50-day Exponential Moving Average (EMA) at $2026.48 suggests potential bearish undertones. This development hints at a possible shift towards a selling trend if gold prices dip below the strategic level of $2029.

Given the technical landscape and prevailing market conditions, a cautious approach is recommended. Traders might consider a sell strategy below $2029, with an eye towards a take profit target at $2020 and a stop loss positioned at $2037, to navigate the anticipated fluctuations effectively.

Daily Price Outlook

Despite the Canadian CPI inflation data showing a larger-than-anticipated easing to 2.9% in January, the USD/CAD currency pair continued its downward trajectory, lingering around the 1.3520 level. However, this decline cannot solely be attributed to Canadian economic factors. The weakening of the US dollar has played a significant role in the bearish trend.

The US dollar had initially been on a bullish run, fueled by the Federal Reserve's adoption of a hawkish stance and positive US economic indicators. Nonetheless, this bullish momentum has faded recently as the release of the FOMC minutes revealed concerns among policymakers regarding the potential risks of rapid rate cuts. Hence, the dovish comments from Fed officials further undermined the US dollar, consequently exerting downward pressure on the USD/CAD pair.

On the other hand, crude oil prices increased on Tuesday. However, the rise was driven by concerns about reduced oil supplies due to ongoing disruptions in global shipping and conflicts in the Middle East. The stability in oil prices could support the Canadian dollar and contribute to losses in the USD/CAD pair.

Fed Plans for Interest Rate Cuts and Potential Impact on USD/CAD Pair

On the US front, the Federal Reserve, led by Chairman Jerome Powell, expressed a cautious approach toward lowering interest rates. Powell mentioned that the Fed wants to ensure that inflation consistently reaches the 2% target before considering rate cuts. Additionally, the minutes from the Federal Open Market Committee (FOMC) meeting revealed concerns among some policymakers about the potential risks associated with reducing interest rates too quickly.

Hence, these dovish remarks are bearish for the US dollar because they indicate a cautious approach to lowering interest rates, potentially reducing its attractiveness to investors seeking higher returns.

Anticipated Bank of Canada Rate Cuts and Impact on USD/CAD Pair

On the Canadian side, inflation data for January showed a lower increase than expected, reaching 2.9%. This unexpected data has led to speculation that the Bank of Canada might consider lowering interest rates sooner than previously anticipated. While most analysts expect the central bank to maintain interest rates at 5.0% during its upcoming meeting on March 6th, the likelihood of a rate cut at the April meeting has increased to 58% following the release of the Consumer Price Index (CPI) report. This shift in expectations suggests that the central bank may be more inclined to take action to stimulate the economy in response to lower-than-expected inflation.

Therefore, the anticipated rate cuts by the Bank of Canada may weaken the Canadian dollar, potentially causing the USD/CAD currency pair to rise as the US dollar gains strength.

Upcoming Economic Data Releases Impacting CAD Currency Pairs

Looking ahead, investors are keeping their eyes on upcoming economic indicators like US Durable Goods Orders, Consumer Confidence, and the Richmond Fed Manufacturing Index, along with remarks from Fed's Michael Barr.

USD/CAD - Technical Analysis

The USD/CAD pair has exhibited a modest uptick of 0.01%, positioning itself at 1.35066 as of February 27. This minor increase underscores a period of consolidation within the forex market, with technical indicators and price movements suggesting a mix of stability and potential volatility.

Key technical levels frame the current landscape for USD/CAD. The pivot point at 1.3454 acts as a foundational benchmark, with immediate resistance observed at 1.3492. Further resistance levels at 1.3551 and 1.3589 delineate potential ceilings for price ascensions. On the flip side, support levels at 1.3403, 1.3357, and 1.3319 serve as critical junctures where buying interest may resurface to bolster the pair.

The Relative Strength Index (RSI) at 51 indicates a market in equilibrium, hinting at a balanced dynamic between buyers and sellers. The Moving Average Convergence Divergence (MACD) presents a value of 0.00014 against a signal of 0.00032, suggesting a cautious market sentiment with potential for directional shifts. The 50-day Exponential Moving Average (EMA) at 1.3506 closely mirrors the current price, reinforcing the state of consolidation.

A symmetrical triangle pattern observed on the chart signals a consolidation phase for the Canadian dollar, with a bearish engulfing pattern and a cross below the 50 EMA potentially indicating an impending selling trend. This technical setup suggests a cautiously bearish outlook in the short term.

Daily Price Outlook

Gold price (XAU/USD) prolonged its upward trend and remained well bid around the $2,035 level. However, the upward trend in gold prices were mainly driven by the sliding US Treasury bond yields and the bearish performance of the US dollar. Furthermore, the long-lasting geopolitical tensions in the Middle East along with a recession in Japan and the UK were seen as another key factor that gave support to the safe-haven gold. On the flip side, the losses in the US dollar could be short-lived amid the Federal Reserve's (Fed) hawkish outlook for higher-for-longer interest rates. This could cap gains in the gold price.

Fed's Influence on US Dollar and Gold Prices

Despite the Federal Reserve's (Fed) hawkish outlook for higher-for-longer interest rates, the broad-based US dollar failed to maintain its upward trend and turned bearish, possibly due to the recent drop in US Treasury bond yields. However, the losses in the US dollar could be temporary as the latest meeting minutes and statements from Federal Reserve officials indicate they're not rushing to lower interest rates. Meanwhile, Kansas City Fed President Jeffrey Schmid said we should wait until we're sure inflation is under control. Most people think there won't be a rate cut in March, but there's a 60% chance there will be one in June. Hence, the current downward momentum in the US dollar is pushing gold prices higher.

Looking ahead, traders are careful about making big decisions before the release of the US Personal Consumption Expenditures (PCE) Price Index on Thursday. They want to see when the Fed might raise interest rates. This caution could make it harder for gold prices to go up.

Geopolitical Tensions and Economic Uncertainties Drive Demand for Safe-Haven Gold

Apart from this, the ongoing tensions in the Middle East are also boosting the appeal of the safe-haven precious metal. As per the latest report, Israeli attacks on Gaza since October 7 killed 29,782 and wounded 70,043. The revised death toll in Israel from the same attacks is 1,139. At the same time, the negotiations for a ceasefire between Israel and Hamas in Gaza are happening again because many countries are urging them to stop the fighting in Gaza. Whereas, Biden aims to end the conflict and secure the release of hostages by March 10, before Ramadan starts. These developments heighten geopolitical uncertainties, which push investors towards safe-haven assets like gold.

On the other hand, the recession in Japan and the UK continues to boost the appeal of the safe-haven precious metal. Japan's GDP fell unexpectedly, following a previous quarter's 3.3% contraction. The UK's decline comes before an election. Japan lost its third-largest economy status to Germany. The IMF expects Germany to surpass Japan. Economists anticipated Japan's GDP growth, but it may be revised.

Therefore, the recessions in Japan and the UK, along with Japan's unexpected GDP fall and loss of economic status to Germany, bolster the appeal of safe-haven gold amid economic uncertainties.

GOLD - Technical Analysis

Gold's technical outlook remains cautiously optimistic as the precious metal navigates through a delicate balance of market forces. As of February 27, gold is slightly up by 0.07%, trading at $2,032.61, reflecting a subtle uptick in investor sentiment amidst a backdrop of global economic uncertainties. The market's attention is fixed on the pivotal $2,028 pivot point, a level that gold has recently surpassed, suggesting a potential for further upward movement if sustained.

The immediate resistance levels are set at $2,051 and extend up to $2,093, marking significant barriers that gold would need to overcome to continue its ascent. On the downside, support levels are clearly defined at $2,011, $1,986, and $1,969, which serve as cushions should there be a reversal in the current trend. These levels are crucial for traders to monitor, as they could indicate potential entry or exit points based on the market's reaction.

From a technical perspective, the Relative Strength Index (RSI) stands at 56, indicating neither overbought nor oversold conditions, which aligns with the market's current state of equilibrium. The MACD, however, presents a mixed signal with a value of -0.09 against a signal of 2.99, suggesting that while there's potential for upward momentum, caution is warranted. The 50-day Exponential Moving Average (EMA) at $2,032 acts as a testament to gold's resilience, hovering around the current trading price and offering a baseline for bullish sentiments.

Daily Price Outlook

Despite the risk-off market sentiment, the AUD/USD currency pair managed to stop its downward trend and attracted some bids around the $0.6545 level. However, the upward movement can be attributed to the release of the improved S&P/ASX 200 on Tuesday, which indicates that the stock market performance, particularly of the top 200 companies listed on the Australian Securities Exchange (ASX), has shown positive growth or gains.

Furthermore, the expected lifting of tariffs on Australian wine by China by the end of March is generally positive news for the Australian Dollar (AUD) as the removal of tariffs can boost Australian wine exports to China, improving trade relations and increasing demand for the Australian Dollar due to improved economic prospects and trade stability.

Moreover, the US dollar lost its momentum and started to decline, even though the Federal Reserve hinted at keeping interest rates high for longer. This change could be linked to the disappointing New Home Sales data and lower US Treasury bond yields. These factors helped the AUD/USD pair stay strong.

Impact of Australian Economic Data and Reserve Bank of Australia Policies on AUD Market Sentiment

On the data front, Australian Consumer Confidence remained nearly unchanged at 83.2, staying below the 85 mark for 56 weeks. However, the unchanged Consumer Confidence and potential rate cut by the Reserve Bank of Australia may weaken the AUD, but economic updates could change its direction. Nevertheless, the downbeat data is overshadowed by the improved S&P/ASX 200. This index reflects the performance of the top 200 companies listed on the stock market, suggesting positive market sentiment and potentially supporting the Australian Dollar's recovery.

Investors are keeping a close eye on two key economic indicators: the Consumer Price Index (CPI) and Retail Sales. Experts now think the Reserve Bank of Australia might cut interest rates by 0.25% in November, rather than August as previously thought.

Impact of Federal Reserve Statements and US Economic Data on AUD/USD pair

Moreover, the broad-based US dollar is struggling to bounce back but remains bearish amid lower US Treasury yields and previously released downbeat US home data. However, the losses in the US dollar could be temporary as the latest meeting minutes and statements from Federal Reserve officials indicate they're not rushing to lower interest rates.

On the data front, US New Home Sales Change (MoM) rose by 1.5% in January, lower than the previous growth of 7.2%. January's US New Home Sales (MoM) reached 0.661M, missing the expected 0.680M and the prior figure of 0.664M. The lower-than-expected growth in US New Home Sales and missing sales figures indicate potential weakness in the housing market, which could negatively impact the US Dollar.

Impact of Geopolitical Tensions and Economic Recession on AUD/USD Pair

In contrast to this, the risk-off market sentiment pressured by the ongoing tensions in the Middle East tends to undermine riskier assets like the AUD currency and could cap gains in the AUD/USD pair. On the other hand, the recession in Japan and the UK continues to hinder growth in the AUD/USD pair. Japan's GDP recorded an unexpected decline, following a significant contraction of 3.3% in the previous quarter. Furthermore, Japan's position as the world's third-largest economy was overtaken by Germany. The IMF foresees Germany surpassing Japan in economic size.

AUD/USD - Technical Analysis

In the currency markets, the AUD/USD pair has seen a slight decline of 0.07%, positioning itself at 0.65263 as of February 27. Despite the dip, the Australian dollar exhibits resilience against the US dollar, with key technical indicators and price levels suggesting a nuanced outlook.

The pair hovers below the pivot point of 0.6559, a crucial level for traders monitoring potential shifts in momentum. Resistance levels are staged at 0.6599, 0.6637, and 0.6675, marking thresholds for bullish advances. Conversely, support levels at 0.6487, 0.6451, and 0.6417 delineate zones where buyers might emerge to uphold the pair's value.

Technical indicators shed light on the current market dynamics. The Relative Strength Index (RSI) at 45 suggests that the AUD/USD is neither overbought nor oversold, indicating a potential for either direction depending on market sentiment. The Moving Average Convergence Divergence (MACD) stands at -0.0004 with a signal of -0.0002, hinting at a narrowly bearish sentiment but with room for reversal. The 50-day Exponential Moving Average (EMA) at 0.6545 closely aligns with current prices, suggesting a consolidation phase.

An upward trendline on the 4-hourly chart and a bullish engulfing pattern around the 0.6525 level signal a sturdy support zone, bolstering the case for a potential uptick. Considering these factors, the technical outlook for AUD/USD leans towards cautious optimism.

Daily Price Outlook

Despite hawkish remarks from US Federal Reserve officials and a bullish US dollar, the EUR/USD currency pair maintained its upward trend and remained bullish around the 1.0831 level. However, the bullish momentum of the euro could be attributed to hawkish remarks from the European Central Bank (ECB), suggesting delayed monetary policy easing. This signals confidence in the Eurozone economy, stabilizing interest rates, and potentially strengthening the currency. This can be witnessed after several ECB policymakers stated they will wait for more evidence of inflation data before easing monetary policy. On the other hand, the US dollar is gaining momentum on the back of the Fed's hawkish stance, seen as a key factor that caps further gains in the EUR/USD pair.

European Central Bank's Cautious Monetary Policy Stance

On the Euro front, European Central Bank (ECB) is keeping an eye on inflation to decide if they need to adjust monetary policy. If inflation goes down in the first few months of the year, they might consider easing it further. However, they're waiting to see if wages go up before deciding what to do next as rising wages can lead to increased consumer spending and inflation, prompting central banks to consider tightening monetary policy to control inflation.

Some policymakers prefer to wait for more data before deciding anything. They're being cautious to ensure their decisions are based on solid evidence, aiming to keep the eurozone economies stable and growing steadily. Therefore, the cautious approach of ECB policymakers suggests a focus on maintaining economic stability and growth, which could be positive for shared currency. Whereas, the uncertainty surrounding timing and differing views may introduce some volatility, making the impact on the EUR currency unclear.

Federal Reserve's Cautious Approach Impacting Dollar's Direction

On the US front, the broad-based US dollar remains strong as the Federal Reserve is taking a cautious approach, possibly delaying interest rates cuts. Fed officials are closely monitoring inflation but are waiting for more data to confirm if it's temporary or lasting. Some, like John C. Williams, lean towards raising rates, while others, like Christopher J. Waller, suggest waiting to see if high inflation persists

Therefore, the strength of the US dollar is likely to exert downward pressure on the EUR/USD pair due to increased demand for the dollar.

EUR/USD - Technical Analysis

The EUR/USD pair exhibited a slight uptick in the latest trading session, nudging upward by 0.03% to position itself at 1.08206. This minor gain reflects the currency pair's subtle momentum within a tightly contested market landscape, as indicated in the four-hour chart analysis. The pivot point, established at 1.08147, serves as the foundational marker from which traders might discern potential directional moves.

Technical analysis reveals immediate resistance levels at 1.08576, 1.08872, and 1.09269, suggesting potential ceilings that could limit upward movements. Conversely, support levels at 1.07907, 1.07615, and 1.07331 provide a safety net against downward price action. The Relative Strength Index (RSI), standing at 57, indicates a market that is neither overbought nor oversold, suggesting balanced trading conditions.

The 50-day Exponential Moving Average (EMA) at 1.07993 closely aligns with the current price level, reinforcing the upward trend's support. This technical setup advocates for a cautiously optimistic outlook on EUR/USD, suggesting a buying trend might be underway.

Considering this analysis, the proposed strategy for engaging with the EUR/USD market includes initiating a buy position above 1.08127, aiming for a take-profit target at 1.08523, while setting a stop loss at 1.07858 to manage potential downside risks. This approach underscores a nuanced understanding of the market's current dynamics, offering a calculated pathway for capitalizing on the observed bullish sentiment.

Daily Price Outlook

Despite the continued geopolitical tensions, the Gold price (XAU/USD) failed to stop its bearish bias and remained well below 2,030 level. However, the reason for its downward trend can be attributed to hawkish Fed expectations. These expectations were reinforced after the number of Fed officials indicated that they're not likely to cut interest rates right away as they're focused on getting inflation back to the 2% target. This hawkish stance tends to undermine gold prices. On the positive side, the escalation of military action in the Middle East and the prolonged Russia-Ukraine war was seen as a key factor that helped gold price to limit its deeper losses.

US Dollar Declines Amidst Fed's Firm Stance: Impact on Gold Prices

Despite positive US economic indicators and a hawkish stance from the Federal Reserve, the US dollar experienced mild declines at the start of new week. This decline, combined with rising demand for traditional safe-haven assets, helps gold price to limit its losses. However, expectations that the Federal Reserve will delay interest rate cuts until the June policy meeting have limited losses in the US dollar, which ultimately is not good for gold.

It should be noted that the January FOMC meeting minutes showed that policymakers want more confidence in declining inflation before considering rate cuts. In the meantime, several Fed officials have suggested that immediate rate cuts are unlikely as the central bank aims to return inflation to the 2% target. Consequently, reduced expectations of an early interest rate hike by the Federal Reserve due to US inflation data have weighed on gold prices.

Geopolitical Tensions Heighten: Impact on Safe-Haven Assets like XAU/USD

On the positive side the losses in the gold price could be temporary as the ongoing geopolitical tensions in both the Middle East and the Russia-Ukraine conflict could potentially lend support to the safe-haven XAU/USD. Israel's announcement of its intention to expand operations against Hamas amidst uncertainty surrounding a ceasefire, coupled with reports of Russia preparing for a new offensive against Ukraine, further exacerbates geopolitical anxieties.

Furthermore, recent military actions by the US and UK against Houthi sites in Yemen, in response to ongoing attacks on commercial vessels by Iran-backed Houthi rebels, add to the current geopolitical instability. Hence, these actions contribute to geopolitical instability, which often increases demand for safe-haven assets like gold, potentially leading to higher prices.

GOLD - Technical Analysis

Gold's market behaviour on February 26 showcases a minor decrease, with the price settling at $2032.83, reflecting a modest retreat of 0.13%. This movement is captured within a four-hour trading window, highlighting a pivotal moment at a pivot point of $2027.13. This point serves as a critical juncture for traders, marking the threshold between potential gains and losses.

In this trading environment, resistance levels are staged at $2041.30, $2053.29, and $2065.71, each representing barriers to upward momentum. Conversely, supports are found at $2015.06, $2001.46, and $1988.19, suggesting foundational levels that could arrest declines. The Relative Strength Index (RSI) at 57 signals a market in equilibrium, neither overbought nor oversold, while the 50-day Exponential Moving Average (EMA) at $2022.65 indicates a supportive trend for buyers.

Given these dynamics, the outlook for gold appears cautiously optimistic, proposing a strategic entry for buyers at a buy limit of $2027. This approach is fortified by a proposed take-profit target at $2040 and a stop loss at $2017, crafting a calculated framework for engagement with gold's immediate future in the market. This trading strategy, delineated by key technical indicators and price levels, underscores a nuanced understanding of gold's current position and its potential trajectory, balancing risk with opportunity.

Daily Price Outlook

Despite the improving UK PMI data and the potential end of recession, the GBP/USD currency pair was unable to extend its previous four-day upward rally and started this news week on a bearish track. The pair has been trading around the 1.2670 level, which shows bearish sentiment. However, the main reason for its declines is the renewed strength of the US dollar, which gained strength in the wake of hawkish comments from Federal Reserve officials, undermining the GBP/USD pair.

Furthermore, the lower February consumer confidence data from the United Kingdom (UK) has played a major role in undermining the GBP currency and contributes to the GBP/USD pair losses. In contrast to this, the improving UK PMI data indicates growth in the country's economic activity across various sectors, suggesting a strengthening UK economy. Furthermore, the end of the recession means that the economy is emerging from a period of contraction, which is typically viewed positively by investors and can support the value of the British Pound.

Impact of Mixed UK Economic Data on GBPUSD Pair

On the UK data front, the GfK Consumer Confidence index for the UK dropped to -21 in February, which is lower than expected and shows people are less confident about the economy. On the positive side, the previously released UK PMI data shows things are getting better, and it seems like the recession from last year might be ending. This can be witnessed after the MUFG Bank experts say recent data hint the recession from last year could be ending. Meanwhile, the S&P Global/CIPS UK Manufacturing PMI improved slightly in February but remained below expectations. Whereas, the UK Services Business Activity Index stayed strong, beating forecasts.

Therefore, this data presents a mixed picture for the GBPUSD pair as the positive signs for the UK economy include indications of the recession ending and stronger-than-expected services activity help the GBP/USD pair to limit its losses. However, negative factors such as the disappointing consumer confidence index and the manufacturing PMI falling below expectations could weigh on the pound's performance.

Impact of Hawkish Fed Stance on GBP/USD Pair

Another factor pressuring the GBP/USD pair is the bullish US dollar, supported by a hawkish stance by the Fed. The broad-based US dollar has maintained its upward trend, hovering near three-month highs against other currencies. This strength is fueled by comments from Federal Reserve officials signaling a cautious approach to interest rate hikes due to persistent inflation.

Moving ahead, the upcoming PCE price index data, a key inflation indicator for the Fed, is expected to provide further clarity on inflation trends. Meanwhile, Federal Reserve President John C. Williams hinted at potential rate hikes later in the year but emphasized they would only be done if necessary. Another Fed official, Christopher J. Waller, suggested delaying rate hikes to assess whether recent high inflation reports are temporary. Therefore, the statement suggests a potential positive outlook for the dollar, as it hints at potential rate hikes.

GBP/USD - Technical Analysis

The British Pound (GBP/USD) edges slightly higher in today's trading session, marking a 0.03% increase to reach 1.26660. This subtle upward movement suggests a cautious optimism among traders, as evidenced in the four-hour chart analysis. The currency pair finds itself navigating around a pivot point at 1.26488, which acts as a critical juncture for future price direction.

Technical analysis highlights several key resistance levels at 1.26932, 1.27215, and 1.27586, which could pose challenges for further bullish momentum. On the flip side, support levels are established at 1.26111, 1.25778, and 1.25385, offering a foundation to buffer any downward pressures. The Relative Strength Index (RSI) stands at 57, indicating a market that is neither overbought nor oversold, but rather in a state of equilibrium.

The 50-day Exponential Moving Average (EMA) at 1.26318 closely aligns with the current pricing, suggesting a convergence of technical indicators in support of a continuing uptrend. This alignment, coupled with the RSI's neutral stance, underscores the potential for a sustained buying trend.

Considering the present technical landscape, the strategy for GBP/USD appears tilted towards the bullish side. Traders might consider entering a buy position above 1.26591, aiming for a take-profit level at 1.26948, with a stop loss set at 1.26304 to mitigate risk. This approach is predicated on the currency pair's ability to maintain its upward trajectory, supported by the 50 EMA and the upward trendline.